The current water supply agreements between Oak Lawn and its five customer communities – Tinley Park, Orland Park, Mokena, New Lenox and Oak Forest – have expired, and those communities are in the process of negotiating a new agreement that will ensure a long-term supply of water to each community for generations to come.
Oak Lawn receives its water from the City of Chicago and then delivers it to the five customer communities, which together comprise nearly 80 percent of Oak Lawn’s customer base. As such, those communities realized they had more leverage collectively than each would have individually and decided to work together to negotiate a new agreement.
The current water system infrastructure was assembled in a patchwork fashion in the 1970s when demands for water were significantly lower. It has a single water main and can provide only 55mgd (millions of gallons per day) to its customer communities.
Over the years since the expired agreements were entered into, most of the customer communities have grown substantially and are beginning to expand beyond the capacity limits of the old water system. In 2030, the total system peak demand is projected at 101mgd, which will require a larger system that provides enhanced redundancy through a looped system.
The water system infrastructure improvements that Oak Lawn and its engineering firm have been designing are estimated to cost about $171 million and are scheduled to be completed in 2018. The new system will have dual, redundant feeds; more modern and efficient pump stations; and significantly larger capacity.
Under the proposed agreement, the cost of design and construction of the extensive water system improvements would be paid for by a series of borrowings by the Village of Oak Lawn. The customer communities would help pay the debt service on these borrowings based on their proportionate demand on the system. Tinley Park’s share is $32 million (20 percent).
Water rates are comprised of three components: 1) the cost of the commodity; 2) the cost of delivering the commodity to Tinley Park; and 3) the cost of delivering the commodity to Tinley Park residents. The cost of the commodity is the largest component of the water rate.
Tinley Park’s water rates as of January 1, 2014 are as follows: $30.94 quarterly water base fee; $5.58 per 1,000 gallons for first 20,000 gallons usage; and $7.78 per 1,000 gallons for any usage above 20,000 gallons.
“Tinley Park has one of the lowest water rates in the region and will continue to do so even after factoring in the cost of Tinley Park’s share of the system improvements,” said Tinley Park Mayor Ed Zabrocki. “Moreover, the Chicago region as a whole has the lowest water rates in the country while at the same time being provided with plentiful, high-quality Lake Michigan water.”